As structural genomics (SG) projects continue to deposit representative 3D structures of proteins, homology modeling methods will play an increasing role in structure-based drug discovery. Although computational structure prediction methods provide a cost-effective alternative in the absence of experimental structures, developing accurate enough models still remains a big challenge. In this contribution, we report the current developments in this field, discuss in silico modeling limitations, and review the successful application of this technique to different stages of the drug discovery process.